SWITZERLAND Law and Practice Contributed by: Philippe Nordmann, Marion Bähler, Christian Hagen, Samuel Lieberherr and Dario Glauser, Walder Wyss Ltd
by the employer. Contributions depend on the indi - vidual insurance contract. With regard to non-occupa - tional accident insurance, the situation is the same as for employees, as described in the foregoing. Daily sickness benefits insurance contributions As with employees, these contributions are usually split 50:50, with at least 50% being borne by the employer. Family allowance contributions Family allowances (child and education allowances as well as, depending on the canton, birth and adop - tion allowances) are paid by the employer to entitled employees, for which the employer is reimbursed by the competent compensation office. Family allowance contributions are mainly borne by the employer based on a percentage of the salary and depend on the can - ton, economic sector and relevant family allowance section at the competent compensation office (usually between 0.7% and 3.5% of the annual gross salary). 5.2 Taxes Applicable to Businesses Corporate Income Tax As is the case for individuals, corporate income tax is levied at the federal, cantonal and municipal levels: • on worldwide net income from all sources in Swit - zerland in case of a tax resident legal entity, includ - ing companies, co-operatives, associations and foundations (so-called unlimited taxation); or • on net income earned in Switzerland in case of a non-tax resident legal entity (limited taxation). A legal entity is considered a tax resident if (i) its statu - tory seat or (ii) its place of effective management is located in Switzerland. Income from enterprises and permanent establish - ments or real estate outside Switzerland is exempt from unlimited (corporate) taxation. Effective corpo - rate income tax rates depend on the canton and the municipality and vary from approximately 12% to 21%. Tax losses may be carried forward and offset against income for the following seven years.
Dividends are subject to participation relief in case of participation of at least 10% of the nominal share capital or reserves or a fair market value of the par - ticipation of at least CHF1 million. This also applies to capital gains derived from the disposal of a qualifying participation (at least 10%), provided that the mini - mum holding period of one year is met. In the case of such income from qualified participations, the corpo - rate income tax will be reduced by the ratio between the net income from the participation and the aggre - gate taxable income of the legal entity concerned. Further deductions may be available, such as IP box, R&D super deduction or notional interest deduction. Capital Tax Tax resident and non-tax resident legal entities in Switzerland are subject to an annual capital tax at the cantonal and municipal levels. Levied on the tax- adjusted net equity, the applicable tax rates range between approximately 0.001% and 0.53%. The capital tax is creditable to the corporate income tax in some cantons. Stamp Duty A one-time capital duty of 1% is levied on any issu - ance of new shares by a tax resident company exceeding the amount of CHF1 million (nominal value and share premium, with any issuance up to such amount being tax-free), and on contributions made by the direct shareholder to such company. In both cases, certain reliefs are available for, inter alia, recapi - talisation, restructuring and migration. A security transfer tax of 0.15% for Swiss securities and 0.3% for foreign securities applies to any transfer of taxable securities: • that are transferred against consideration; • where at least one of the parties or intermediaries involved in the transfer qualifies as a Swiss securi - ties dealer; and • where none of the available exemptions applies. Stamp duty is further levied in certain special legal cases (eg, on insurance premiums).
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